Office of Lawyer Regulation v. Hudec (In Re Disciplinary Proceedings Against Patrick J. Hudec)

2019 WI 39
SUPREME COURT OF WISCONSIN
CASE NO.: 2017AP523-D
COMPLETE TITLE: In the Matter of Disciplinary Proceedings
Against Patrick J. Hudec, Attorney at Law:
Office of Lawyer Regulation,
Complainant,
v.
Patrick J. Hudec,
Respondent.
DISCIPLINARY PROCEEDINGS AGAINST HUDEC
OPINION FILED: April 18, 2019
SUBMITTED ON BRIEFS:
ORAL ARGUMENT:
SOURCE OF APPEAL:
COURT:
COUNTY:
JUDGE:
JUSTICES:
CONCURRED:
DISSENTED:
NOT PARTICIPATING:
ATTORNEYS:
2019 WI 39
NOTICE
This opinion is subject to further
editing and modification. The final
version will appear in the bound
volume of the official reports.
No. 2017AP523-D
STATE OF WISCONSIN : IN SUPREME COURT
In the Matter of Disciplinary Proceedings
Against Patrick J. Hudec, Attorney at Law:
Office of Lawyer Regulation, FILED
Complainant, APR 18, 2019
v. Sheila T. Reiff
Clerk of Supreme Court
Patrick J. Hudec,
Respondent.
ATTORNEY disciplinary proceeding. Attorney's license
suspended.
¶1 PER CURIAM. We review Referee Richard M. Esenberg's
report and recommendation concluding that Attorney Patrick J.
Hudec violated the rules of professional conduct in connection
with his representation of two clients, D.B. and N.K. The
referee recommended that this court impose a 60-day suspension
of Attorney Hudec's law license and condition Attorney Hudec's
continued practice of law on his satisfaction of a monetary
judgment entered in N.K.'s civil lawsuit against him. We adopt
the referee's findings of fact, conclusions of law, and
No. 2017AP523-D
recommendation regarding discipline. We impose the full costs
in this matter, which total $4,319.04 as of January 24, 2019.
¶2 Attorney Hudec was admitted to practice law in
Wisconsin on May 21, 1979. He has a substantial disciplinary
history: a 1989 consensual private reprimand; a 1993 consensual
private reprimand; a 2001 consensual private reprimand; a 2008
consensual public reprimand; and a 2014 public reprimand.
¶3 On March 22, 2017, the Office of Lawyer Regulation
(OLR) filed a complaint against Attorney Hudec alleging six
counts of professional misconduct arising out of his
representation of D.B. and N.K. Attorney Hudec moved to dismiss
the complaint on a variety of grounds. This court appointed a
referee, who denied the motion. Attorney Hudec then filed an
answer in which he denied all misconduct.
¶4 Attorney Hudec later entered into a stipulation in
which he agreed to plead no contest to the six counts of
misconduct charged in the complaint. Attorney Hudec agreed that
the referee could use the allegations of the complaint as a
factual basis for the referee's determination of misconduct.
The parties stipulated that a 60-day suspension was appropriate
discipline. The parties further stipulated that, as a condition
upon his continued practice of law, Attorney Hudec must comply
with any judgment resulting from a pending civil case against
him brought by N.K. The parties further agreed that the
stipulation was not the result of plea bargaining; that Attorney
Hudec's entry into the stipulation was knowing and voluntary;
and that he understood the misconduct allegations made in the
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No. 2017AP523-D
OLR's complaint, his right to contest those allegations, his
right to consult with counsel, and the ramifications of his
entry into the stipulation.
¶5 In January 2019, the referee filed his report and
recommendation. The referee accepted the parties' stipulation
and found, based on the stipulation, that the following facts
were true.
Representation of D.B. (Counts 1-3)
¶6 D.B.'s mother, J.A.R., died in May 2012. In June
2012, D.B. hired Attorney Hudec to represent her in her capacity
as personal representative for her mother's estate. D.B. paid
Attorney Hudec a $1,500 advanced fee. Attorney Hudec did not
communicate the scope of the representation or the basis or rate
of the fee in writing to D.B. within a reasonable time of
commencing the representation, nor did he provide her with a
written communication explaining the purpose and effect of the
advanced fee.
¶7 J.A.R.'s will was admitted to probate. On November
16, 2012, C.D., another daughter of J.A.R., filed a claim
against the estate concerning payments made on her mother's
behalf and an asserted interest in a house she had shared with
her mother. Attorney Hudec received a copy of the claim.
¶8 Attorney Hudec failed to file an objection to C.D.'s
claim within 60 days as required by Wis. Stat. § 859.33. He
also failed to promptly respond to several of D.B.'s emails and
telephone calls requesting information regarding the status of
the estate proceeding.
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No. 2017AP523-D
¶9 On November 6, 2013, nearly a year after C.D. filed
her claim, C.D.'s counsel moved for a default judgment on the
claim, as well as for a protective order relating to discovery.
¶10 On November 20, 2013, Attorney Hudec filed an
objection to C.D.'s claim, a motion for an extension of time for
objections to claims, and various filings in opposition to
C.D.'s motions for default judgment and for a protective order.
¶11 In a December 23, 2013 order, the circuit court
granted C.D.'s motion for default judgment. The circuit court
also granted C.D.'s requested protective order.
¶12 On December 30, 2013, C.D. filed a notice of entry of
judgment.
¶13 On January 8, 2014, Attorney Hudec filed a motion for
reconsideration and a "Motion to Reopen Judgment." The circuit
court denied these motions, noting that Attorney Hudec's failure
to timely file an objection to C.D.'s claim was not the result
of excusable neglect, but rather was part of a pattern of late
filings in his handling of the estate proceedings.
¶14 Attorney Hudec did not timely appeal from the circuit
court's default judgment. He did, however, timely appeal from
the circuit court's order denying the estate's motions for
reconsideration and to "reopen" the default judgment.
¶15 In November 2014, the court of appeals affirmed the
circuit court's order. In doing so, it noted the circuit
court's observation that Attorney Hudec had engaged in a pattern
of missed deadlines for reasons that did not meet the standard
for excusable neglect.
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No. 2017AP523-D
¶16 In March 2015, the circuit court ordered that D.B.
continue as the personal representative and retain new counsel.
¶17 In a November 2015 letter to the OLR, D.B. stated that
Attorney Hudec had not provided her with copies of the circuit
court and appellate decisions; that he had provided "only a
general synopsis of what took place"; that successor counsel had
provided her with copies of these decisions; and that she was
"astonished" by what she read and disappointed in the amount of
information Attorney Hudec had withheld from her.
¶18 In February 2016, the circuit court entered a final
judgment, entered an order discharging the personal
representative, and closed the case.
¶19 The OLR complaint alleged, the parties stipulated, and
the referee determined that by failing to communicate the scope
of the representation and the basis or rate of the fee in
writing to D.B. within a reasonable time after commencing the
representation, and by failing to communicate the purpose and
effect of the advanced fee in writing to D.B., Attorney Hudec
violated SCR 20:1.5(b)(1) and (2)1 (Count 1).
1 SCR 20:1.5(b) provides:
(1) The scope of the representation and the basis
or rate of the fee and expenses for which the client
will be responsible shall be communicated to the
client in writing, before or within a reasonable time
after commencing the representation, except when the
lawyer will charge a regularly represented client on
the same basis or rate as in the past. If it is
reasonably foreseeable that the total cost of
representation to the client, including attorney's
fees, will be $1000 or less, the communication may be
(continued)
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No. 2017AP523-D
¶20 The OLR complaint alleged, the parties stipulated, and
the referee determined that by failing to timely object to
C.D.'s claim against the Estate, by failing to timely appeal
from the trial court's default judgment, and by failing to
comply with several deadlines during the case, Attorney Hudec
violated SCR 20:1.32 (Count 2).
¶21 The OLR complaint alleged, the parties stipulated, and
the referee determined that by failing to keep D.B. reasonably
informed about the status of the case and by failing to promptly
respond to several of D.B.'s requests for information regarding
the case, Attorney Hudec violated SCR 20:1.4(a)(3) and (4)3
(Count 3).
Representation of N.K. (Counts 4-6)
oral or in writing. Any changes in the basis or rate
of the fee or expenses shall also be communicated in
writing to the client.
(2) If the total cost of representation to the
client, including attorney's fees, is more than $1000,
the purpose and effect of any retainer or advance fee
that is paid to the lawyer shall be communicated in
writing.
2
SCR 20:1.3 provides: "A lawyer shall act with reasonable
diligence and promptness in representing a client."
3 SCR 20:1.4(a) provides: "A lawyer shall:
(3) keep the client reasonably informed about the status of
the matter.
(4) promptly comply with reasonable requests by the client
for information."
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No. 2017AP523-D
¶22 In January 2012, N.K. hired Attorney Hudec to pursue a
defamation claim against B.K. regarding B.K.'s complaint to the
Better Business Bureau about N.K.'s business. In April 2012,
Attorney Hudec filed a defamation suit on behalf of N.K. and her
business against B.K. and B.K.'s husband, D.K.
¶23 In June 2012, D.K. filed a motion for sanctions on the
basis that there was no evidence he was a party to the alleged
defamation and, therefore, he should not have been named as a
defendant. Also in June 2012, B.K. filed an answer and
affirmative defenses to N.K.'s complaint, and D.K. filed a
counterclaim and a motion to dismiss.
¶24 In July 2012, Attorney Hudec filed documents in
opposition to D.K.'s motions for sanctions and to dismiss.
¶25 In August 2012, the circuit court held a hearing and
granted D.K.'s motion to dismiss on the ground that there was no
evidence to justify naming him as a party. The circuit court
denied D.K.'s motion for sanctions.
¶26 In October 2012, Attorney Hudec filed a reply to the
counterclaim and motion to dismiss that D.K. had filed several
months earlier. D.K. responded by moving to strike Attorney
Hudec's filing as untimely and moving for a default judgment on
the counterclaim. The circuit court ultimately granted D.K.'s
motions. Attorney Hudec failed to adequately communicate that
fact to N.K.
¶27 Over the following months, Attorney Hudec missed a
variety of court-imposed deadlines. In April 2013, B.K. filed a
motion for sanctions as a result of these missed deadlines.
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No. 2017AP523-D
Attorney Hudec failed to inform N.K. of this motion, and failed
to inform her of the subsequently scheduled hearing on the
motion. Attorney Hudec then failed to appear at the sanctions
hearing. The circuit court dismissed plaintiffs' case with
prejudice, finding Attorney Hudec's actions were egregious,
extreme, substantial, and persistent. The circuit court noted
the following facts: (1) Attorney Hudec had been granted
extensions for various medical issues; (2) court-mandated
mediation never took place; (3) Attorney Hudec failed to provide
requested discovery to opposing counsel; (4) Attorney Hudec
failed to file a pretrial report; and (5) Attorney Hudec stated
that he intended to withdraw as counsel for plaintiff, but
failed to so do, filing only unsigned documents.
¶28 As a sanction for failing to comply with its
scheduling order, the circuit court imposed attorney's fees of
$3,862.50 against plaintiffs and Attorney Hudec. The court gave
plaintiffs leave to seek relief from the imposition of
attorney's fees by filing a motion with the court.
¶29 The circuit court kept a scheduled final pretrial
conference on its calendar to discuss matters related to D.K.'s
counterclaim. N.K. appeared at the final pretrial conference.
Attorney Hudec did not. N.K. did not know that Attorney Hudec
would not be in attendance. She did not know that the circuit
court had dismissed her claims against the defendants. She did
not know that the circuit court had imposed sanctions against
her and Attorney Hudec.
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No. 2017AP523-D
¶30 In May 2013, N.K. paid an amount to the defendants in
order to settle the default judgment that D.K. had obtained on
his counterclaim.
¶31 In June 2013, N.K. retained a new lawyer and satisfied
the sanctions judgment in favor of the defendants.
¶32 In December 2016, N.K. filed a civil suit against
Attorney Hudec, his law office, and his insurance carrier, if
any, seeking recovery of her previous payments to Attorney Hudec
and other damages she alleged were caused by him. This lawsuit
was pending at the time of the parties' stipulation. Although
the referee's report does not note as much, the court takes
judicial notice that, according to Wisconsin's Consolidated
Court Automation Programs (CCAP) records, a $9,235.48 judgment
against Attorney Hudec and in N.K.'s favor was entered on
December 14, 2018, and Attorney Hudec has not filed a notice of
appeal of the judgment.
¶33 The OLR complaint alleged, the parties stipulated, and
the referee determined that by failing to timely file a reply to
D.K.'s counterclaim resulting in the court striking plaintiffs'
pleading and granting default judgment on the counterclaim, and
by failing to comply with the court's scheduling order, Attorney
Hudec violated SCR 20:1.3 (Count 4).
¶34 The OLR complaint alleged, the parties stipulated, and
the referee determined that by failing to inform N.K. that he
did not timely file a reply to D.K.'s counterclaim, by failing
to inform N.K. that the court granted a default judgment on the
counterclaim, and by otherwise failing to keep N.K. reasonably
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No. 2017AP523-D
informed about the status of the case, Attorney Hudec violated
SCR 20:1.4(a)(3) (Count 5).
¶35 The OLR complaint alleged, the parties stipulated, and
the referee determined that by failing to make a reasonably
diligent effort to comply with defendants' discovery requests,
Attorney Hudec violated SCR 20:3.4(d)4 (Count 6).
¶36 The referee recommended a 60-day suspension of
Attorney Hudec's license in his report. The referee noted that
Attorney Hudec has an extensive disciplinary record (three
private and two public reprimands), and that his previous
misconduct included neglect similar to what occurred here.
See, e.g., Public Reprimand of Patrick J. Hudec, No. 2008-2
(electronic copy available at
https://compendium.wicourts.gov/app/raw/002005.html) (imposing a
public reprimand for misconduct that included failing to act
with reasonable diligence and promptness, failing to keep his
client reasonably informed, and failing to timely respond to the
OLR's investigative efforts); In re Disciplinary Proceedings
Against Hudec, 2014 WI 46, 354 Wis. 2d 728, 848 N.W.2d 287
(imposing a public reprimand for misconduct that included
failing to provide competent representation; e.g., gross
inattention to detail in circuit court litigation, filing a
principal appellate brief rife with grammatical and spelling
4
SCR 20:3.4(d) provides: "A lawyer shall not in pretrial
procedure, make a frivolous discovery request or fail to make
reasonably diligent effort to comply with a legally proper
discovery request by an opposing party."
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No. 2017AP523-D
errors, and filing an appellate reply brief that was struck as
untimely and was not served on opposing counsel).
¶37 The referee also pointed to certain cases that support
a 60-day suspension under similar circumstances. See In re
Disciplinary Proceedings Against Moldenhauer, 2016 WI 43, 369
Wis. 2d 1, 879 N.W.2d 605 (imposing a 60-day suspension for
failing to act with reasonable diligence and promptness and
failing to keep a client reasonably informed; respondent-
lawyer's disciplinary history included a private reprimand and
three public reprimands for similar misconduct); In re
Disciplinary Proceedings Against Theobald, 2010 WI 102, 329
Wis. 2d 1, 786 N.W.2d 834 (imposing a 60-day suspension for
failing to act with reasonable diligence and promptness and
failing to keep a client reasonably informed; respondent-
lawyer's disciplinary history included two public reprimands for
similar misconduct); In re Disciplinary Proceedings Against
Anderson, 2010 WI 39, 324 Wis. 2d 627, 782 N.W.2d 100 (imposing
a 60-day suspension for failing to act with reasonable diligence
and promptness and failing to properly communicate with a
client; respondent-lawyer's disciplinary history included two
public reprimands and a private reprimand for similar
misconduct).
¶38 The referee also deemed it reasonable for the court to
require Attorney Hudec to comply with any judgment resulting
from N.K.'s lawsuit against him——a term the parties agreed to in
their stipulation.
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No. 2017AP523-D
¶39 Neither party appealed the referee's report, so this
matter is submitted to the court for review pursuant to
SCR 22.17(2). We review a referee's findings of fact subject to
the clearly erroneous standard. See In re Disciplinary
Proceedings Against Eisenberg, 2004 WI 14, ¶5, 269 Wis. 2d 43,
675 N.W.2d 747. We review the referee's conclusions of law de
novo. Id. We determine the appropriate level of discipline
independent of the referee's recommendation. See In re
Disciplinary Proceedings Against Widule, 2003 WI 34, ¶44, 261
Wis. 2d 45, 660 N.W.2d 686.
¶40 We agree with the referee that a 60-day suspension is
appropriate. Clearly, Attorney Hudec's many previous reprimands
have not impressed upon him the importance of his ethical
obligations. "This court has long adhered to the concept of
progressive discipline in attorney regulatory cases." In re
Disciplinary Proceedings Against Netzer, 2014 WI 7, ¶49, 352
Wis. 2d 310, 841 N.W.2d 820. A suspension is the next step in
the progressive discipline process, and Moldenhauer, Theobald,
and Anderson instruct that under circumstances like those
present here, a 60-day suspension is appropriate.
¶41 We turn next to the issue of restitution. The OLR did
not request restitution related to Attorney Hudec's
representation of D.B. The OLR reports that while some of
Attorney Hudec's work on D.B.'s mother's estate was clearly
deficient, its investigation did not provide a reasonably
ascertainable amount of funds to be restored. In addition, the
OLR reports, any losses the estate incurred as a result of
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No. 2017AP523-D
Attorney Hudec's failure to object to C.D.'s claim would
constitute incidental or consequential damages, as opposed to
funds that were under Attorney Hudec's direct control. Given
these circumstances, we agree with the OLR that no restitution
is warranted related to the D.B. matter. See In re Disciplinary
Proceedings Against Blessinger, 2017 WI 107, ¶21, 378
Wis. 2d 539, 905 N.W.2d 122 (noting that the OLR's policy is to
seek restitution only when, among other things, there is a
reasonably ascertainable amount of restitution, and the funds to
be restored were in the lawyer's direct control and do not
constitute incidental or consequential damages).
¶42 Although the OLR did not seek restitution related to
the N.K. matter, the parties stipulated, and the referee agreed,
that the court should condition Attorney Hudec's continued
practice of law on his satisfaction of any monetary judgment
entered in N.K.'s civil lawsuit against him. As mentioned
above, CCAP records show that N.K. obtained a $9,235.48 judgment
against Attorney Hudec in December 2018. Consistent with the
parties' stipulation and the referee's recommendation, we deem
it appropriate to require, as a condition of the reinstatement
of his Wisconsin law license, that Attorney Hudec satisfy this
judgment.
¶43 Finally, we deem it appropriate to impose the full
costs of this disciplinary proceeding on Attorney Hudec, as is
our usual custom. See SCR 22.24(1m).
¶44 IT IS ORDERED that the license of Patrick J. Hudec is
suspended for a period of 60 days, effective May 30, 2019.
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No. 2017AP523-D
¶45 IT IS FURTHER ORDERED that within 60 days of the date
of this order, Patrick J. Hudec shall pay to the Office of
Lawyer Regulation the costs of this proceeding, which are
$4,319.04 as of January 24, 2019.
¶46 IT IS FURTHER ORDERED that, as a condition of
reinstatement of his license to practice law in Wisconsin,
Patrick J. Hudec shall satisfy the judgment issued against him
and in N.K.'s favor in connection with the misconduct described
herein.
¶47 IT IS FURTHER ORDERED that Patrick J. Hudec shall
comply with the provisions of SCR 22.26 concerning the duties of
a person whose license to practice law in Wisconsin has been
suspended.
¶48 IT IS FURTHER ORDERED that compliance with all
conditions of this order is required for reinstatement. See
SCR 22.28(2).
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No. 2017AP523-D
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